Cobalt demand unaffected by Tesla’s decision to use less cobalt in batteries

Tesla announced back in May that they were planning to reduce the cobalt in their batteries due to the concerns of child labour in the Congo, environmental and social concerns, cost, and projected supply issues. Surprisingly, this has barely affected the demand of cobalt since then. Although almost all battery manufacturers are developing batteries with less cobalt, demand will continue to increase. Why? Because the expected growth for electric vehicles is so high. Unless EV battery manufacture is halted completely, cobalt demand is on the upswing. Cobalt is a key component to these batteries, because of it’s role as a stabilizer. The chemistry of the whole battery will need to change if cobalt is removed, making the switch to cobalt-free batteries a goal that remains in the distant future. It should also be mentioned that due to the supply scare, many battery manufacturers have made long-term supply agreements with cobalt mines, many of these contracts are 5-10 years long, meaning cobalt will have a guaranteed steady demand for the contract period, if not longer.

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